Vivus shares fall on regulatory concerns
Deena Beasley
LOS ANGELES
Tue Jun 15, 2010 3:15pm EDTRelated NewsAmylin shares rise ahead of diabetes meeting
Mon, Jun 14 2010
Common blood pressure drugs may raise cancer risk
Sun, Jun 13 2010
Common blood pressure drugs may raise cancer risk
Sun, Jun 13 2010
Glaxo's Avandia increases heart risks: U.S. reviewer
Fri, Jun 11 2010
UPDATE 1-Glaxo's Avandia increases heart risks-US reviewer
Fri, Jun 11 2010Stocks
Vivus Inc
VVUS.O
$10.95
-0.99-8.29%
12:00am UTC+0200
GlaxoSmithKline PLC
GSK.L
1,205.00p
+4.50+0.37%
12:00am UTC+0200
Johnson & Johnson
JNJ.N
$59.14
+0.72+1.23%
12:00am UTC+0200
LOS ANGELES (Reuters) - Shares of Vivus Inc (VVUS.O) fell as much as 9 percent on Tuesday after analysts raised questions about how regulators will view the safety of its experimental weight loss drug.
Hot Stocks
The Food and Drug Administration is slated to decide by October 28 whether to approve the drug, called Qnexa, and an outside panel of experts will make its recommendation to the agency at a July 15 hearing.
The Qnexa panel meeting will follow a two-day meeting, probably with some of the same experts, on the safety risks of GlaxoSmithKline PLC's (GSK.L) controversial diabetes drug Avandia.
Lazard analyst William Tanner on Tuesday downgraded shares of Vivus to "hold" from "buy," citing the risk of an unfavorable panel review.
"We have increasing concerns about how the FDA may change the cardiovascular safety testing standard for new drugs for obesity," Jefferies analyst Thomas Wei said in a research note.
He said the FDA has imposed stringent cardiovascular requirements for diabetes drugs and "it is noteworthy in itself that the FDA has invited cardiologists to the Qnexa panel."
Wei said he spoke to a cardiologist and a psychiatrist, both of whom were invited to be on the Qnexa panel but declined to participate. The cardiologist said he would have voted against approval, while the psychiatrist would have voted yes.
"I think what people are worried about is the fact that two days prior to the Qnexa meeting they are going to be talking about Avandia and its heart risk," said Steve Yoo, an analyst at Leerink Swann.
Vivus' Qnexa combines the generic stimulant phentermine and generic epilepsy drug topiramate, which Johnson & Johnson (JNJ.N) sells under the brand name Topamax. One trial showed that taking Qnexa led to weight loss of 14.7 percent over a year, compared with 2.5 percent for placebo patients.
J&J had studied Topamax as a weight loss drug, but decided not to pursue the indication because of adverse side effects, including minor memory impairment.
Tanner said in a research note that consultants question whether such cognitive impairment might not sway the panel to recommend against approval.
Also, high doses of phentermine can raise blood pressure levels, but Vivus says the low doses of both topiramate and phentermine used in Qnexa result in much more moderate side effects.
Clinical trials have shown that Qnexa improves some risk factors for heart disease, including decreasing blood pressure, bad cholesterol and triglycerides, but at higher doses it also causes increases in heart rate.
"It could be a problem, but it's tough to tell," Yoo said.
A spokesman for Vivus declined to comment on the speculation.
Lazard's Tanner said a "potential fly in the ointment" is that Vivus may have insufficient data for approval of the low and mid-level doses of Qnexa, since one-third of clinical trial patients were treated with the higher dose of the drug.
"Requirement of additional testing would significantly delay approval and launch," he said in a research note.
Shares of Vivus were down 98 cents or 8.2 percent at $10.96 on the Nasdaq on Tuesday afternoon, off an earlier low at $10.84.
(Reporting by Deena Beasley, editing by Matthew Lewis)